1. Define the term ‘taxable person’ under the CGST Act?
Taxable person means a person who is registered or liable to be registered under section 22 or section 24. (Section 22 deals with persons liable for registration and Section 24 deals with compulsory registration)
Taxable supply means a supply of goods or services or both which is leviable to tax under this Act.
Non-taxable supply means a supply of goods or services or both which is not leviable to tax under the CGST Act or under the IGST Act.
Exempt supply” means supply of any goods or services or both which attracts nil rate of tax or which may be wholly exempt from tax and includes the non-taxable supply.
All India basis. (Aggregate turnover includes the aggregate value of all taxable supplies exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number, to be computed on all India basis)
The definition of aggregate turnover excludes (i) Central Tax, State-Tax, Union Territory Tax, Integrated Tax, Cess. (ii) Inward supplies on which tax is payable by a person on a reverse charge basis.
Aggregate turnover of A Ltd. will be the sum of turnovers of all the three States (i.e.) Kerala, Maharashtra, and Karnataka. (Aggregate turnover of persons having the same PAN shall be computed on all India basis.)
Deemed exports means such supplies of goods as may be notified under Section 147 of CGST Act, 2017.(Section 147 of the CGST Act states that the Government may, on the recommendations of the Council, notify certain supplies of goods as deemed exports, where goods supplied do not leave India, and payment for such supplies is received either in Indian rupees or in convertible foreign exchange, if such goods are manufactured in India.)
(a) all forms of supply of goods or services or both such as sale, transfer, barter, exchange, licence, rental, lease or disposal made or agreed to be made for a consideration by a person in the course or furtherance of business;
(b) import of services for a consideration whether or not in the course or furtherance of business;
(c) the activities specified in Schedule I, made or agreed to be made without a consideration.
The activities enumerated in Schedule-I will qualify as supply even if made without consideration.
a) Transactions between Related Persons
b) Supply of Goods via Agent
c) Taxable Person Importing Services from a Related Person, in the course or furtherance of business.
d) Permanent Transfer of Business Assets where ITC has Been Availed on Such Assets
Yes, As per CGST Act, 2017, every person who is required to obtain separate registration for every branch located in different State or Union territory shall be treated as distinct persons.
Gifts exceeding Rs.50,000/- by an employer to employee will be a supply, when made in the course or furtherance of business and will be liable to tax.
The Schedule III & activities or transaction notified by Government under section 7(2)(b) of the CGST Act defines the transactions which are neither considered as supply of goods nor supply of service.
Composite supply means a supply consisting of two or more taxable supplies of goods or services or both, or any combination thereof, which are naturally bundled and supplied in conjunction with each other in the ordinary course of business, one of which is a principal supply. (Principal supply means the supply of goods or services which constitutes the predominant element of a composite supply)
Tax liability in case of composite supply should be determined with reference to the principal supply forming part of such composite supply. (i.e. tax rate applicable for the principal supply will be the tax rate of total supply)
Mixed supply means two or more individual supplies of goods or services or any combination thereof, made in conjunction with each other by a taxable person for a single price where such supply does not constitute a composite supply.
The tax liability in case of a mixed supply shall be ascertained with reference to that particular supply which attracts highest rate of tax.
Recipient actually purchases the equipment, making the equipment the principal supply, the installation makes the equipment usable by the recipient. The service is naturally bundled and provided in the ordinary course of business, the supply would be a composite supply, even if, there is a separate charge for the installation of the equipment.
Section 15 of the CGST Act, 2017 specifies that the value of supply of goods or services or both shall be the transaction value, which is the price actually paid or payable for the said supply of goods or services or both where the supplier and the recipient of the supply are not related, and the price is the sole consideration for the supply. (In other cases, the provisions and method for ascertaining the value of taxable supply as prescribed in the CGST Rules (Rules 27 – 35) shall apply.)
a. Alcohol for human consumption
b. Petroleum Products such as petroleum crude, motor spirit(petrol), high speed diesel, natural gas and aviation turbine fuel etc.
The term reverse charge means the liability to pay tax by the recipient of supply of goods or services or both instead of the supplier of such goods or services or both.
As regards the recipient who pays tax on reverse charge basis, tax so paid would be available as credit subject to Section 17 of the CGST Act, 2017. As regards the supplier whose tax is paid by the recipient, value of such supply will be treated as ‘exempt supply’.
24. What are the implications if, supplier charges GST on the invoice though reverse charge is applicable?
Recipient is free to reduce the GST charged from the value of invoice and pay only the net amount but liable to discharge the reverse charge obligation separately.
No, even if supplier has somehow paid tax, reverse charge liability must be discharged by the recipient. The supplier can claim for refund of tax wrongly paid.
Registered person, whose aggregate turnover in the preceding financial year did not exceed Rs.1.5 crore rupees, may opt to pay tax as a percentage of their turnover. Further, this limit, is rupees seventy-five lakhs in the case of an eligible registered person, registered in any following States, namely: –
(i) Arunachal Pradesh
(ix) Himachal Pradesh
No, a registered person shall not be eligible to opt for the composition scheme unless all such registered persons (branches having separate registration) opt to pay tax under composition scheme.
The time of supply of goods shall be the earliest of the following:
a) Date of issue of invoice or the last date on which he is required, OR
b) Date on which the supplier receives the payment with respect to the supply.
It is provided that the tax invoice should be issued before or at the time of removal of goods for supply to the recipient. As such, it is inferred that the date of removal of goods shall be the ‘due date of issuance of invoice’, unless invoice is actually issued before such date.
30. What will be the time of supply where multiple invoices are issued for a single consignment involving supply of goods?
The time of supply of goods shall be the date of issuance of invoice; or due date for issuance of invoice whichever is earlier.
In terms of Section 12(6) of the CGST Act, 2017, the date on which the supplier receives interest, penalty or late fee which forms part of value will be the time of supply.
As per Rule 47 of the CGST Rules, 2017 the time limit for issuing a tax invoice is 30 days from the date of provision of service. In case of Insurer, Banking Company, Financial Institution including NBFC’s the said time limit is 45 days from the date of supply of services.
33. What is the rate of GST to be charged on advances received before the change in rate of tax if the supply is completed after the change in rate of tax?
If the invoices are also raised before the change in rate of tax, then the old rate will be applicable even though the supply is complete after the change in rate of tax. Else, the new rate will be applicable.
Only a registered person will be allowed to take input tax credit. If a person is liable to register but did not register himself under the GST law, input tax credit will not be allowed to such person.
No, ‘Inputs’ are defined under section 2(59) of the CGST Act to mean any goods other than capital goods used or intended to be used by a supplier in the course or furtherance of business.
All the conditions for availing input tax credit should be satisfied under Section 16(2) of the CGST Act 2017. One of the conditions is the receipt of goods or services or both. Without this actual receipt, the input tax credit cannot be availed. So, input tax credit should only be available in the month when the goods are actually received.
The credit on goods/ services used partly for business and partly for non-business purposes will be allowed proportionately to the extent it is attributable for business purposes.
No, Section 17(5) (h) specifically restricts input tax credit on goods disposed of by way of gift or free samples.
Input tax paid on goods which are destroyed/pilfered and where shortage has occurred will not be eligible. Section 17(5)(h) specifically restricts input tax credit on goods lost, stolen, destroyed, written off or disposed by way of gift or free samples.
No, In terms of Section 18(3) of the CGST Act, transfer of unutilized input tax credit is permissible only when there is change in constitution of the business with the specific provision of transfer of liabilities.
The registered person will be deemed to have received the services where these services have been provided by the supplier to any person on the direction of and on account of such registered person.
If movement of goods is involved, then the tax invoice has to be issued before or at the time of removal of the goods for supply to the recipient.
In cases where the ownership, or the risks and rewards are transferred without requiring the movement of goods, the goods would be treated as supplied although no movement is involved in effecting such supply.
44. When should a Tax Invoice be issued for supply of Goods, where movement of goods are not involved?
If movement of goods is not involved, then the tax invoice has to be issued before or at the time of the goods are delivered to the recipient or when the goods are made available to the recipient.
In case of services, Invoice has to be raised within 30 days of supply of service.
In case of banking companies, financial institutions including NBFCs, the time limit for issuing an invoice is extended to 45 days (as against 30 days in respect of other supplier) from the date of supply of service.
Yes. A ‘receipt voucher’ containing prescribed particulars should be issued on receipt of any advance payment towards supply of goods or services.
The invoice should be prepared in triplicate. The original is for the recipient, the duplicate for the transporter and the triplicate for the supplier. The copies should be marked as ‘ORIGINAL FOR RECIPIENT’, ‘DUPLICATE FOR TRANSPORTER’ and ‘TRIPLICATE FOR SUPPLIER’, as the case may be.
No. Every person will have to get registered separately for each of the State from where he makes taxable supply if he is liable for registration in terms of section 22(1) of the CGST Act.
50. What is the time limit for taking registration under GST Law?
Every Person who is liable to be registered shall apply within 30 days from the date on which he becomes liable to registration in such manner and subject to such conditions as may be prescribed.
51. Who are the persons liable to take a Registration under the GST Law?
Every supplier of goods whose aggregate turnover exceeds Rs.40 Lacs (20 Lacs for special category States) in a financial year is liable to get himself registered in a State from where he makes taxable supplies.
Every supplier of services whose aggregate turnover exceeds Rs.20 Lacs (10 Lacs for special category States) in a financial year is liable to get himself registered in a State from where he makes taxable supplies.
One or more credit notes may be issued in the following cases:
• The taxable value on which the tax is collected is more than the actual taxable value
• The tax charged is more than what should have been charged
• The recipient has returned the goods or
• The recipient has found that the goods or services or both supplied are deficient.
Furnishing details outward supplies of goods or services or both.
Summary Return to be filed containing details of outward supply, outward tax and ITC claim. Only return through which payment can be adjusted presently.
Challan Identification Number (CIN) is the number generated for identification of payment made by the taxable person.